Energy & Natural Resources

The framework after the 2024 reform: who now holds the pen

Mexico rewrote the rules of its power sector between late 2024 and 2025. A constitutional reform restored the Federal Electricity Commission (CFE) as a public enterprise of the State with a guaranteed majority of the generation the system dispatches, and a new Ley del Sector Eléctrico replaced the 2014 Ley de la Industria Eléctrica. The permitting functions of the former Energy Regulatory Commission (CRE) passed to the Comisión Nacional de Energía (CNE), a body under the Ministry of Energy. The grid operator, CENACE, keeps its role at the center of every interconnection.

For a private operator the practical map is this: generation above the exempt threshold requires a CNE permit; interconnection runs through CENACE studies and a connection contract with CFE; supply comes either from CFE as basic supplier or, for large users, through the qualified-user and qualified-supplier route; and any project that generates, stores or self-supplies at scale must fit one of the schemes the new law recognizes, including self-consumption and the mixed-investment models designed around CFE.

The reorganization is recent enough that forms, procedural manuals and internal criteria are still settling. That is why we confirm the exact route with the authority at the moment of each filing rather than relying on the version of the rules that applied at the last project.

Getting connected: CENACE studies and the CFE contract

Interconnection is a sequence, not a single application. It begins with the studies CENACE runs for the requested capacity at the point of connection, continues with the definition of the infrastructure works the local network needs to receive your load or your generation, and ends with the connection contract and, where applicable, the supply contract. When the nearest substation lacks headroom, the works become the project inside the project: they carry their own budget, their own schedule and their own negotiation over who pays and who owns them.

Large consumers have a second decision to make: whether to remain with CFE basic supply or to register as a qualified user and buy power from a qualified supplier under a bilateral contract. That choice changes the price exposure, the contractual counterpart and the regulatory obligations of the plant, and it should be taken with the interconnection file, not after it.

The constant we tell every client is simple: the higher the demand, the earlier the filing. In several industrial corridors of the north and the Bajío, grid capacity is the scarcest input of the launch.

Legacy self-supply and cogeneration: the charge that arrives in October 2026

A large share of foreign-owned plants in Mexico still buys power under permits granted before the 2014 reform, under the old Ley del Servicio Público de Energía Eléctrica: the self-supply (autoabastecimiento) and cogeneration societies whose interconnection contracts remain in force. Two Acuerdos published in the Diario Oficial de la Federación on June 18, 2026 changed their economics. The CNE replaced the methodology of the transmission charge those permits pay, with effect from October 19, 2026, and the Ministry of Energy opened a voluntary, expedited route to migrate legacy permits into the structures of the Ley del Sector Eléctrico.

The new charge is labelled transmission, but the methodology adds distribution, CENACE system operation and non-market ancillary services to it, and for renewable and cogeneration plants it also captures the amounts of the energy bank under the legacy interconnection contract. The migration procedure runs on fixed calendar windows that the guidelines themselves declare cannot be extended, and it has to be started by the permit holder, which in most self-supply structures is the supplier, not the plant.

We read these instruments article by article for our clients and work with both sides of a self-supply society: verifying whether the permit holder has filed, quantifying the exposure under the new methodology, and negotiating the allocation of the charge inside the supply contract where the structure stays in place.

Water for the process: concessions after the December 2025 reform

Industrial use of national waters, whether from a well or a surface source, requires a concession title from CONAGUA. In basins under restriction new titles may not be available, and the realistic alternatives become acquiring existing rights, connecting to municipal or industrial-park supply, or designing the process around treated and recycled water. Each route has a different legal instrument and a different timeline.

Holders of existing titles face a regime that changed on December 11, 2025. The window to request renewal now opens three years before expiry and closes six months before it; under the previous rule it opened five years before. Missing the window is deemed a waiver of the right to renew. The clause that instructed the authority to consider the full recovery of the concessionaire’s investment when deciding on renewal was deleted; the decision now weighs water responsibility and the record of duty payments instead.

A second regime reaches the volume a plant is not using. Partial caducidad can be declared when part of the titled volume goes unused for two consecutive years, and since August 5, 2026 a regulation specifies that the period is counted in completed calendar quarters. The exposure is not the title but the unused slice of it, and it is triggered by ordinary commercial decisions: a deferred second phase, a recirculation project, a line that never came. We audit titled volume against metered extraction, quarter by quarter, and file the protections the regulation allows while they are still available.

Federal environmental permits: what a plant needs before it operates

The environmental file of an industrial plant is a set of federal and state instruments that have to exist before the first shift, and stay alive afterwards. The environmental-impact authorization comes first: federal, from SEMARNAT, for the activities the General Law of Ecological Balance and its regulation reserve to the federation, and state-level for the rest. It arrives with conditions attached, and those conditions are obligations with deadlines, not recommendations.

Then come the operating instruments. Fixed sources of emissions under federal jurisdiction need the Licencia Ambiental Única and file the annual operating report (Cédula de Operación Anual). Any plant that generates hazardous waste must register as a generator under the General Law for the Prevention and Integral Management of Waste, in the category its volumes dictate, and large generators must have a management plan. If the site had vegetation, the change of land use in forest land is a separate federal authorization with its own technical study and compensation payment. Above the reporting threshold, greenhouse-gas emissions are reported annually to the National Emissions Registry.

We manage these filings at the source, and we keep a single calendar of conditions, renewals and reports per site. Forgotten conditions are an inspector’s favorite finding.

Inspections: PROFEPA and CONAGUA

PROFEPA, the enforcement arm of the environmental sector, arrives with an inspection order and reviews in hours what the operation built over years. The visit produces a record (acta) that fixes the facts of the proceeding, and the deadlines to offer evidence and arguments are short and counted in business days. What is not objected to at the right moment is very hard to recover later. The same is true of CONAGUA’s own visits on extraction, metering and discharges.

We accompany the visit from the first minute: verifying the order and the inspectors’ credentials, recording observations in the acta, protecting the deadlines, attending corrective and urgent measures, and defending the company in the administrative proceeding and, where needed, before the federal courts. The goal is not to win the fine. It is to prevent the closure.

Contaminated sites and environmental due diligence

Under Mexican waste law the owner and the possessor of a contaminated site are responsible for its remediation, and transferring a contaminated site requires the authority’s involvement. A buyer or tenant that did not investigate inherits the problem with the keys. That is why environmental due diligence, with soil and groundwater sampling where the history of the site warrants it, is part of every industrial acquisition or long lease we handle, and why the contract allocates the risk expressly: baseline, indemnities, escrow where the numbers justify it.

The same discipline applies to M&A. A target’s permits, conditions, waste manifests, discharge results and inspection history are read before the price is final, because they are the part of the balance sheet the seller did not write down.

Land, environmental and social permits for generation projects

A generation or storage project sits on land, and the land has to be able to carry it. We verify the agrarian history at the National Agrarian Registry, because ejido land that was never fully regularized is the classic defect behind an attractive site; we confirm that the municipal land-use classification admits industrial generation; and we register the easements and rights of way the transmission line and the access roads will need, so that promises made at the negotiating table become rights enforceable against whoever owns the neighboring parcels tomorrow.

On the regulatory side, generation projects typically require an environmental-impact authorization from SEMARNAT and, as energy-sector projects, a social-impact evaluation before the Ministry of Energy, in addition to the municipal construction and operating licenses. Where a site is vegetated, the change of land use in forest land is a separate federal authorization with its own study and its own compensation payment.

We condition every land document, purchase, lease or easement, on the project actually being permittable there. The client should never own a site its project cannot use.

The preventive program: audits, certifications and one calendar

The best defense is built before the inspection order exists. A regulatory-exposure diagnostic maps every instrument the site should hold against what it actually holds; a compliance calendar turns conditions, reports and renewals into dated tasks with owners; and, where it makes sense, the voluntary environmental audit before PROFEPA closes the loop with a recognized certification that documents compliance and, in practice, changes the tone of any later visit.

Frequently asked questions

Does an on-site solar or cogeneration plant for my own factory need a permit?

It depends on capacity. Generation below the exempt threshold set by the Ley del Sector Eléctrico can operate without a generation permit, although it still needs an interconnection contract with CFE and must comply with the applicable technical rules. Above that threshold a permit from the Comisión Nacional de Energía is required, and the project has to fit one of the schemes the law recognizes, such as self-consumption. We confirm the threshold and the scheme at the moment of filing, because both were redefined by the 2025 legislation.

How long does interconnection to the grid take?

There is no single answer, and anyone who gives you one without seeing the point of connection is guessing. The time is driven by the CENACE studies, by whether the local network needs reinforcement works to receive your load, and by the connection contract with CFE. In constrained corridors the process routinely takes longer than building the plant itself, which is why we start the file before engineering begins and negotiate utility conditions into the land documents.

Can a foreign-owned company hold a generation permit in Mexico?

Yes, through a Mexican entity. Power generation is not a sector reserved to Mexican nationals under the Foreign Investment Law. What the 2024 reform did was reserve a majority of the system’s generation to CFE and reorganize how private capacity participates, through permits, self-consumption schemes and mixed-investment models. The permit is held by the Mexican company, which must be current on its corporate, tax and foreign-investment registrations.

What happens to my legacy self-supply contract if it is not migrated?

From October 19, 2026 the permit pays the transmission charge under the new methodology, which includes distribution, CENACE operation and ancillary services in addition to transmission, and for renewable and cogeneration plants also incorporates the amounts of the energy bank under the legacy contract. Permit holders that started the voluntary migration within the 2026 windows and whose contracts remain in force beyond October 2028 are shielded from the new methodology for a transitional period. The filing had to be made by the permit holder, so the first thing we check for a plant is whether its supplier filed.

Can we buy water rights from another concession holder?

Transfers of concession rights exist and run through CONAGUA, but they are governed by the rules in force after the December 2025 reform, which expressly excluded transfers and changes of use from the transitional grace period. The route that let a holder sell an unused volume ahead of a caducidad declaration while preserving the original term was also removed. Any plan built on acquiring or selling water rights should be re-examined against the current text before a price is agreed.

Does my plant need a federal or a state environmental-impact authorization?

It depends on the activity, not on the size of the investment. The General Law of Ecological Balance and its impact regulation list the works and activities that require federal authorization from SEMARNAT; everything else falls to the state environmental authority. Some projects require both, at different stages. We classify the project before any land document is signed, because the answer changes the timeline by months.

What happens during a PROFEPA inspection visit?

The inspectors present an order that defines the scope of the visit, review the installations and documents within that scope, and draw up an acta that records what they found. The company may make observations in the acta and has a short statutory period, counted in business days, to offer evidence and arguments. The authority may impose corrective measures, and in urgent cases security measures such as partial or total closure. How the acta is handled on the day largely determines how the proceeding ends.

Are we liable for contamination caused by a previous owner or tenant?

You can be. Mexican waste law makes the owner and the possessor of a contaminated site responsible for remediation, regardless of who caused the contamination, and they may then seek recovery from the party responsible. That is why we investigate before closing and allocate the risk in the contract, rather than discovering it in an inspection.